CK Narayan Suggests Buying Dips As Retail Flows Buy Out Corrections

"The market is absolutely not interested in going down," the founder of NeoTrader told NDTV Profit in an interview on Tuesday.

He said that the election results, which saw Prime Minister Narendra Modi win by a slim margin, and the recently proposed long- and short-term capital gains tax failed to shake up the markets. "If two of these biggest things are not willing to send the market down, it is very evident that this market has absolutely no interest in doing so."

The geopolitical tensions in West Asia that earlier spooked markets are no longer a concern, he said. "In that context, we have to think that the long term is steadfastly up, in which case every dip that you get must be used for getting into the market rather than thinking about markets going down."

The market veteran said that domestic stocks are returning to business as usual following the yen carry trade impact. "The much-awaited event would be a record past 25,000 (for Nifty), which will once again get the juices going."

Everyone has been waiting around for a correction, and the fact that all the corrections are being bought into is proof that there is money waiting at the lower end, Narayan noted. "Foreign institutions are not the market's key movers right now, although historically they have been the biggest movers."

What has transpired over the last three to four years is the deluge of money coming from SIP and the like, he said. "FIIs as a factor has been pushed into the background."

India's benchmark indices—the NSE Nifty 50 and the S&P BSE Sensex—have risen 13% and 12%, respectively, so far this year, making them the sixth and seventh best performing Asian indices, respectively.